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What is Valuation Class? and How to Define and Set It

3 min read
Change Valuation Class

What is Valuation Class

Group of material having same account determination is called valuation class. We can group together different materials with similar properties by valuation class. Eg Raw material, Finished Goods, Semi-Finished. We can define the following assignments in customizing: All materials with the same material type are assigned to just one valuation class.

Different materials with the same material type can be assigned to different valuation classes. Materials with different material types are assigned to a single valuation class.

The Valuation Class in Accounting 1 View in Material Master is the main link between Material Master and Finance. This Valuation Class along with the combination of the transaction keys (BSX, WRX, GBB, PRD ) defined above determine the GL account during posting.

From the IMG screen: Materials Management -> Valuation and Account Assignment -> Account Determination -> Account Determination without Wizard -> Define valuation classes

Click on the Material type/account category reference button

Note the account category reference assigned to each of the material types.

  • Click the Exit button.
  • Click on the Valuation class button.
  • Note which valuation classes are linked to the account category references noted above.

Change Valuation Class

How do you create a valuation class in SAP?

Set (review) Valuation Control

The valuation grouping code allows you to group similar sections of your business together to ease the financial reporting procedures. In our example, the valuation code is used to group together plants. The plants will then be able to use the same inventory and GR/IR accounts so that every instance of inventory is accounted for in the same way. After assigning the valuation grouping code, you will assign accounts to your valuation code. When all accounts are assigned, the system will be able to automatically move inventory through the GR/IR accounts and post them to additional specific accounts upon receipt.

From the IMG screen: Materials Management -> Valuation and Account Assignment -> Account Determination -> Account Determination without Wizard -> Define valuation control

The valuation grouping code default is set as active.

Verify that this is so.

Valuation Area Grouping

From the IMG screen: Materials Management-> Valuation and Account Assignment -> Account Determination ->  Account Determination without Wizard -> Group together valuation areas

Assign valuation grouping code to your company in the valuation area. This will be a four character code. In our examples, we used either AP _ _ or EP _ _. These codes were chosen to remind us the valuation grouping code is for “All Plants”, or “Every Plant”. As was the case with the company code, any four character code will work.

Define Valuation Area

This screen is the drill down from the SAP easy access screen, accessed the following way:

Tools -> Accelerated SAP -> Customizing -> Edit projects -> SAP Reference IMG (button)

From this point, perform the following drill down, as shown in the following screen (Again, in the case of this screen double-clicking the paper icon or triple-clicking the letters brings up a help window and the arrow to the left reveals the next level. At the final level, a run icon also appears, double click this to proceed.):

Enterprise Structure -> Definition -> Logistics-General -> Define valuation level

Essentially, the next level allows no changes. The defined valuation is preset at the plant level.

1 thought on “What is Valuation Class? and How to Define and Set It

  1. Are there any business circumstances where you would want to allow "changing" of Valuation Class during MIGO posting in SAP (Goods Issue to Reservation etc)? What would the implications be from a reporting and financial perspective of allowing this (order, receive, store inventory with valuation class assigned to material master but change valuation class during goods issue)???

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